Distinguished representatives of the business community,
Ladies and gentlemen,
It is a real pleasure to be with you today, here in London, and to have an opportunity to address the representatives of companies from the United Kingdom, a country with which we have traditionally good relations, both political and economic. On behalf of my nation, I would like to express my gratitude for the comprehensive assistance that you have been providing to us as our friend and significant partner. I hope that the excellent overall political relations, especially expressed through our alliance within NATO for ensuring world peace and democracy, will be accompanied with a substantial promotion of the economic cooperation, thus assisting not only in the development of my country, but also in the development of the region of Southeastern Europe.
Macedonia is a country favorable for running a business. This is best confirmed by the World Bank which has placed Macedonia on the top of the Doing Business list of reformers and favorable business destinations for several consecutive years. Significant progress has been made regarding the Forbs list, too.
The Government of the Republic of Macedonia is continuously working on improving the business climate and working conditions for domestic and foreign companies likewise. Our goal is achieving economic growth, developing the private sector and job creation. We are working hard on enabling favorable conditions for companies to multiply their capital and achieve two-fold benefits, both for the management of the firms and the living standard of the citizens of the Republic of Macedonia.
The latest report of the European Commission once again confirmed that Macedonia chose the right way to tackle the challenges resulting from the current global economic situation. The macroeconomic indicators of Macedonia remain better when compared to the ones of the region, not only in terms of economic growth, but also regarding the level of indebtedness which remains the lowest in the region.
Regarding the macroeconomic indicators, the Republic of Macedonia has a stable macroeconomic policy, where the financial regulation is significantly strengthened. Moreover, the efficiency of the banking supervision is improved, there is a long-term macroeconomic stability with a low inflation rate, which averages 2% in the last 10 years; balanced public finance with a low budget deficit; stable exchange rate and low public debt (26% of the GDP), and this year, the GDP growth in the first quarter is 5.1%, and 5.3% in the second quarter.
Over the past years, numerous reforms have been implemented regarding the labor market, as well as active measures for increasing employment were undertaken. Regarding the tax policy, we introduced low flat taxes of 10%, which makes Macedonia the country with the lowest tax rates in Europe, we exempted from taxation the retained earnings which is not distributed as dividend, i.e. is retained in the company, and we gradually reduced the social contributions by a third. With the Regulatory Guillotine Project, we streamlined business legislation, we established a one-stop-shop system in the customs and tax administration, measures regarding managing construction land have been introduced, thus simplifying the construction procedure, utility fees have been reduced, subsidies for tour operators have been introduced, and many other reforms that would positively influence the business climate in the Republic of Macedonia have been implemented.
The increase in foreign investment and GDP growth come as a result of the comprehensive reforms for improving the overall business climate. As I previously pointed out, the Republic of Macedonia is among the top three reformers according to the renowned World Bank “Doing Business” Report for 2010, for the achieved results.
Given the improved business climate and the activities for promoting the Republic of Macedonia as an attractive business destination, we managed to attract world – renowned companies in the Technological Industrial Development Zone in Skopje, such as Johnson Matthey and Johnson Controls, which opened their facilities prior to the global economic crisis. It is important to point out that after the most recent economic recovery, in the past 4 months there has been an investment cycle in Macedonia, where Johnson Controls is opening another, second plant, and the investments of TeknoHose from Italy, Kemet Electronics from the USA, Protek Group from Russia and Motherson Group from India have arrived and started with construction. Simultaneously, another three technologic industrial development zones have been opened in Shtip, Tetovo, and another one in Skopje.
One of the leading automotive component companies in the world, the British company Johnson Matthey, recognized and chose Macedonia as its business destination. The Johnson Matthey plant is successfully operating in the Technological Industrial Development Zone in Skopje 1. They recognized the advanatges that Macedonia offers to foreign investors: favorable location, quality workforce, low taxes, good infrastructure and pro business oriented state institutions which are willing to provide their full support to foreign companies for the investment process. You could consult them for our opportunities and potentials, in order to receive a confirmation that what we have stated is actually being realized, without any delay.
I would like to stress that the top priority of the Republic of Macedonia, in the political and economic fields, remains the vision of a common presence and future in the large European and Euro Atlantic family, which will be achieved by our membership in NATO and the EU. It would represent a great benefit for the overall prosperity of the whole region and beyond. This means that sharing the same values and beliefs is yet another guarantee that your business in Macedonia will be secure and sustainable.
The United Kingdom is a leader of the global economic and political processes. Historically viewed, the United Kingdom has greatly contributed to assisting the development of the Southeastern European region, in every respect – democratically, socially, culturally, economically… I hope that our generation, too will continue the traditions of bilateral cooperation, mutual assistance and meeting the joint needs and interests.
I invite you to visit us and become personally acquainted with the favorable business climate of our country, and I hope that Macedonia will be on your map as a destination for doing business.
Thank you and I wish you every success with your businesses.